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Put Something In to Get Something Out: Cutting housing benefit for the under 25s

Following the Prime Minister's announcement that he is considering cutting housing benefits to under-25s, Politeia Director Dr Sheila Lawlor discusses the need to restore contribution as the basis for the benefit system.

The Welfare State depends on a contract - between the individual and the state. No, that's not the Prime Minister talking, though he has raised the prospect of cutting housing benefit for the under 25s, but what William Beveridge, the founder of the Welfare State, intended. People had to contribute during working life to be entitled to benefit when they stopped earning. And for those who did not earn or contribute? They would be paid subsistence from public funds, a lower sum than was set for contributory benefit. The State, said Beveridge, had a moral duty to see that those who worked and earned were better off than those who did not work -whatever the reason. Now ministers at the Department of Work and Pensions have set out plans to make work pay by allowing people to keep more of what they earn as they move off benefit and into work.

But many 16-25 year olds are not in work; and nor are they in training or education. The Coalition is considering cuts to housing benefits for unemployed under-25s, many of whom will be expected to live at home while they train and find a job. That’s already the rule for those in full time education. Quite rightly, it would not apply to vulnerable young people without a home to live in.

However, there's still some way to go in restoring contribution as the basis for benefit, the only way to preserve western welfare state for the future.

Sheila Lawlor
Director

Listen to Sheila Lawlor discussing these issues on BBC Radio 4's Today (starts at 2:55:00).

Click here to read more in Beveridge or Brown? The Real Social Security Debate published by Politeia (Link coming soon).

Friday 31st July: As Andy Burnham sets out his stall for Labour's leadership, he must learn to live within the reality of politics if he wants his party in power, says Politeia's Director, Sheila Lawlor.

To Jeremy Corbyn’s unexpected surge in Labour’s leadership election campaign, can be added a further, less surprising development from another contender. Andy Burnham, has now emerged as a bigger taxer, bigger public spender, than when a minister under Gordon Brown. He boasted in Leeds this week and again on the BBC that he would go further than he had been allowed under Mr Brown’s regime. He wants to impose extra taxes to pay for social care for everyone in old age.

Mr Burnham seems to be out of touch with what voters want. Not only did they return the Conservatives to power in May with a mandate for further benefit and deficit cuts and to shrink, not increase, state dependency; but in a poll for the Independent a majority of those questioned believe Labour to be less electable now than in May. The message was even starker from the analysis of defeated candidates in Labour target seats (lost by the party in 2010) published by the Fabian Society. Their party was not trusted with the economy by the voters, many of whom had switched in 2010 to the Tories.